Going into the all-star break, the Red Sox were seven games behind the Yankees for the division lead with a record of 48–38, but led the wild card.[9] In an attempt to improve the team and solidify a playoff decision and in anticipation for a showdown against the New York Yankees,[10] general manager Theo Epstein traded well-liked shortstop Nomar Garciaparra to the Chicago Cubs in exchange for first basemanDoug Mientkiewicz and shortstop Orlando Cabrera in a four-team deal on the trading deadline (July 31).[10][11] The team fell behind up to 10½ games in the division during the month of August, but managed to come back in September to within two games.[9] However, the Yankees held strong and won the division, finishing three games ahead of the Red Sox.[12] The Red Sox won the AL Wild Card (the best record among three second-place teams) to obtain a spot in the playoffs.[12] Entering the postseason, first baseman Kevin Millar was asked to compare the team with the previous season's team, to which he responded, "I'm pretty sure we're five outs better than last year." It was a reference to the 2003 American League Championship Series, in which the Red Sox held a 5–2 lead over the Yankees with one out in the eighth inning of Game 7, only to blow the lead and lose the series.

The 2004 Yankees began the season in Tokyo with a split against the Rays. Playing a much anticipated game against the Red Sox, the team lost the game 6–2 and 6 out of the first 7 games to their rivals. After falling as many as 4½ games behind the Red Sox on April 25, the team would make up the deficit in less than 2 weeks, including an 8-game win streak. By the end of June, they had a commanding 8½ in the AL East lead over the Sox after sweeping them with a dramatic 5–4 walk-off 13-inning victory. After the All-star break, the Yankees traded José Contreras to the White Sox for Esteban Loaiza. Contreras was signed away from the Red Sox before the 2003 season, but he failed to live up to expectations. With a 10½ game lead in the second week of August, the team struggled and watched their lead dwindle to only 2½ games on September 3. The team held off the Red Sox to claim the division and set up a playoff rematch with the Twins. The results were pretty much the same as the Yankees took the Division Series in 4 games, setting up the rematch.

The Red Sox and Yankees had met 45 times in the previous two years, with Boston holding a 23–22 lead. The Red Sox held an 11–8 advantage over New York in 2004, but eight of the games were decided in one of the teams' final at-bats. Boston outscored New York, 106–105.[13] and this was the fifth time that the two teams met in postseason play, with the Yankees winning the previous four, in 1949, 1978, 1999, and 2003.[13]

The Series was widely anticipated, especially given the outcome of the previous October, when the Yankees beat the Red Sox in seven games when Aaron Boone hit the home run off of Tim Wakefield in the bottom of the 11th inning to send the Yankees to the World Series.[14][15] Yankees General Manager Brian Cashman said that "the two teams in the American League facing each other in this series are the two best teams, period."[16]Fox commentator Joe Buck said as the series began: "What's hard to believe, it was almost exactly one year ago tonight that Aaron Boone hit that 11th inning home run to beat the Red Sox, yet for some reason it seemed predetermined that we would be right back here a year later for a rematch of sort."[17]

Dan Shaughnessy of The Boston Globe wrote that "one year after they (Yankees and Red Sox) jousted to the finish in the Bronx last October in an epic seventh game that appeared to take the clash to its zenith they go at it again..."[18] In this series, Alex Rodriguez, was seemed to answer the Sox' acquisition of Curt Schilling, as the two veteran stars faced each other, wearing the uniforms of the ancient rivals in an October game..."[18] Yankees pitcher Mike Mussina summed up the build-up: "This is what everyone was hoping for...It's a rematch of last year, with the best two teams in the American League."[18]

The New York Times said that this was the showdown the Yankees anticipated the entire season, while the Red Sox craved it an entire year. This was the reason why the Red Sox fired Grady Little, traded Nomar Garciaparra, and added Curt Schilling.[10] Outfielder Johnny Damon said of Boone's home run: "If we do advance to the World Series and win, it's a better story that we went through New York. We needed to get back here. This is where a lot of hearts were broken, and we're in a perfect seat to stop the hurting."[10] Red Sox Theo Epstein agreed, saying "Now that it's here, we can admit that if we're able to win a World Series and go through New York along the way, it will mean that much more."[19]

Game 1 pitted the Red Sox's star pitcher Curt Schilling against Yankees ace Mike Mussina. Schilling entered the game with a 6–1 postseason career record, but the expected pitchers' duel quickly became a one-sided exhibition. Schilling had sustained a torn tendon sheath in his right ankle during Game 1 of the American League Division Series against the Angels, and proved to be ineffective. Mussina, meanwhile, retired the first nineteen Red Sox batters. After scoring six runs off Schilling, the Yankees added two more off Boston knuckleballer Tim Wakefield in the sixth. A Hideki Matsui single made the score 8–0 and gave him an ALCS record-tying five RBIs in the game.

The Red Sox ended Mussina's bid for a perfect game with a rally of five runs in the seventh and added two more in the eighth, closing the gap to 8–7. With two outs and the tying run on third base, however, the Yankees called upon closer Mariano Rivera, who induced a pop out by Kevin Millar. The Yankees scored two more runs in the bottom of the eighth on a double by Bernie Williams. The Sox hit two singles in the top of the ninth inning, but the game ended when Bill Mueller grounded into a double play.

Game 2 featured Pedro Martínez of the Red Sox facing Yankees pitcher Jon Lieber. Again, the Yankees struck first, as Gary Sheffield drove in Derek Jeter in the first inning. The 1–0 score held up for several innings, as Lieber and Martinez put together a classic pitchers' duel.

Martinez got himself in and out of trouble through several innings, but, shortly after making his 100th pitch of the night, walked Jorge Posada and allowed a John Olerud home run, giving New York a 3–0 lead.

Again, the Red Sox rallied, chasing Lieber with two hits in the eighth to close the gap, 3–1. With two outs and a runner on third, however, the Yankees again turned to Rivera, who struck out Johnny Damon to end the inning. Rivera shut down the Red Sox in the ninth by inducing a ground out by Mark Bellhorn, and, after giving up a double to Manny Ramírez, striking out David Ortiz and Millar, ending the game.

As in the first two games, the Yankees began by scoring in the first. Derek Jeter walked and scored from first on a double by Alex Rodríguez. Two batters later, Hideki Matsui hit a home run to right field, giving the Yankees a 3–0 lead. The Red Sox answered in the second inning with a leadoff walk by Jason Varitek and a Trot Nixon home run to right field. A double by Bill Mueller, an infield hit by Johnny Damon (his first hit of the series), and a Derek Jeter error led to two more runs. The Red Sox led for the first time in the series, 4–3.

This lead was short-lived, as Alex Rodríguez led off the third inning with a home run over the Green Monster. Gary Sheffield then walked and Hideki Matsui doubled, prompting Bronson Arroyo to be replaced on the mound by Ramiro Mendoza, who immediately allowed a Bernie Williams RBI single and then balked, allowing Matsui to score from third, letting the Yankees lead 6–4. The Red Sox, however, responded by tying the game in the bottom of the inning, scoring two runs on an Orlando Cabrera double off Yankees reliever Javier Vázquez. After three innings, the game was tied at six.

In the fourth inning, the Yankees took the lead on a three-run home run to left by Gary Sheffield. After another double by Hideki Matsui, the Red Sox put in pitcher Tim Wakefield, who volunteered to forgo his scheduled Game 4 start in order to preserve Boston's battered bullpen. Wakefield got Bernie Williams to pop out and then intentionally walked Jorge Posada. Rubén Sierra then tripled to score Matsui and Posada, giving the Yankees an 11–6 lead.[2]

From that point on the Yankees were in total control, with the New York offense continuing to hit and score runs long into the night. When it was finally over, the Yankees had set a team record for postseason runs scored. Rodríguez, Sheffield and Matsui all had prolific hitting nights. Matsui had five hits and five RBIs, tying LCS records. He and Rodríguez both tied the postseason record for runs scored with five.[2] The two teams combined for 37 hits and 20 extra-base hits, both postseason records.[2] At four hours and twenty minutes, the game was the longest nine-inning postseason game ever played.[2]

Bob Ryan wrote about the Red Sox in The Boston Globe: "They are down, 3–0, after last night's 19–8 rout, and, in this sport, that is an official death sentence. Soon it will be over, and we will spend another dreary winter lamenting this and lamenting that."[26]

Game 4 featured Yankees pitcher Orlando Hernández, the 1999 ALCS MVP against Boston's Derek Lowe. For the first time in the series, the Yankees did not score in the first inning. However, they eventually did score first. With two outs and nobody on in the third inning, Derek Jeter singled. Alex Rodríguez then hit a two-run home run over the Green Monster in the. This hit resembled a home run he hit in Game 3, as it also came in the third inning and went out of the park onto Lansdowne Street. This would be followed by the ball being thrown back into the outfield by fans on the Street, Johnny Damon tossing the ball back over the fence, and the ball once again being tossed back before being pocketed by Umpire Joe West.

Hernández, who had not pitched in two weeks, cruised through the first four innings giving up just one hit and two walks. In the fifth inning, he pitched himself into a jam, walking two of the first three batters. With two men on and two out, Orlando Cabrera singled to right field, scoring Kevin Millar. Manny Ramírez walked to load the bases, and then David Ortiz hit a single to center field, scoring Cabrera and Mark Bellhorn and giving the Red Sox a 3–2 lead, only their second lead in the series.

The lead lasted less than an inning. Hideki Matsui hit a triple with one out in sixth, after which Mike Timlin relieved Lowe. Bernie Williams hit an infield single to score Matsui and tie the game 3-3. After Jorge Posada walked, Williams attempted to advance to third on a passed ball, but was thrown out by Jason Varitek. However, Ruben Sierra hit another infield single, moving Posada to third. Tony Clark then hit a third infield single to score Posada and give the Yankees a 4-3 lead. Miguel Cairo then walked to load the bases for Jeter, but Timlin induced a groundout to escape the inning.

Massachusetts native Tanyon Sturtze pitched two scoreless innings in relief of Hernández. Mariano Rivera, the Yankees star closer, entered the game in the eighth for a two-inning save attempt. In the ninth inning, Rivera allowed a lead-off walk to Kevin Millar, which ultimately turned out to be the turning point of the series. Dave Roberts was then chosen to pinch-run for Millar. With the Red Sox down to their final three outs, Rivera checked Roberts at first base several times before throwing a pitch to Bill Mueller.

According to Roberts, "The first [time Rivera checked me at first base], I felt I got the jitters and then it kind of dissipated a little bit. The second time the jitters were all gone and I was really into it. After the third pick over was a close play, I think the second one was really close also, and then I felt like I had been there from the first inning on."

Roberts added, "At that point I knew, regardless of a slidestep or whatever, once he goes home, I'm going to run on the pitch. If he would have went to the plate the first pitch, I wouldn't have went. Running down that tunnel in October, it's hard to get loose. But that [series of pickoff attempts] kind of helped me out a little bit."

On Rivera's first pitch to Bill Mueller, the speedy Roberts stole second, putting himself in scoring position. Mueller's single allowed Roberts to score, resulting in Rivera blowing the save and the game going into extra innings, tied at four runs apiece.

Both teams threatened for more runs in the eleventh inning, but the game remained tied until the bottom of the twelfth. Ramírez led off with a single against new pitcher Paul Quantrill, and Ortiz hit a two-run walk-off home run to right field. Ortiz became the first player with two walk-off homers in the same postseason; his first capped a Red Sox sweep of the Anaheim Angels in the American League Division Series.

Game 5 began at 5:11 pm EDT on Monday, October 18, just sixteen hours after Game 4 had ended the previous night. Mike Mussina led the Yankees against Boston's Pedro Martínez. The Red Sox drew first blood this time, as David Ortiz drove in a run and Jason Varitek walked with the bases loaded in the first inning to give Boston a 2–0 lead. Bernie Williams homered in the second inning to close the gap to 2–1, a score which would hold up for several innings.

Despite seven strikeouts by Martínez, in the top of the sixth inning, Jorge Posada and Rubén Sierra singled with one out. After Miguel Cairo was hit by a pitch to load the bases, Derek Jeter cleared the bases with a double, giving the Yankees a 4–2 lead. The Red Sox threatened again in the seventh inning, but came up empty. For the second straight night, however, the Yankee bullpen couldn't keep the lead. Ortiz led off the eighth inning with a home run off former Red Sox reliever Tom Gordon, making it a one-run game. Kevin Millar followed with a walk and was again replaced by pinch runner Dave Roberts, who went to third on Trot Nixon's single. Gordon was replaced by Mariano Rivera with the lead still intact, but Jason Varitek's sacrifice fly tied the game. The Yankees threatened in the top of the ninth when former Red Sox player Tony Clark hit a ball to deep right with two outs, but the ball took a hop over the short right-field wall for a ground-rule double, forcing Rubén Sierra to stop at third base, where he was stranded to set up another extra-inning marathon.

Each team got its share of base runners in extra innings. Boston's Doug Mientkiewicz doubled in the tenth and moved to third, but did not score. Two Red Sox led off the eleventh with singles, but Esteban Loaiza, who had struggled since being acquired by the Yankees mid-season, came in to pitch with one out and got Orlando Cabrera to ground into a double play. Knuckleballer Tim Wakefield came on in relief once again for the Red Sox in the twelfth. He allowed a single to Miguel Cairo, who went to second on a Manny Ramírez error, but Cairo was eventually stranded. In the top of the thirteenth, Red Sox catcher Jason Varitek, who does not normally catch for Wakefield and who admits to be poor at catching knuckleballs, allowed three passed balls, but the Yankees stranded runners on second and third when Sierra struck out. Loaiza pitched well over his first two innings, but, in the bottom of the fourteenth, Damon and Ramírez walked, bringing up Ortiz with two outs. The previous night's hero did his job again, singling to center on the 10th pitch of the at-bat to bring home Damon and setting off another celebration at Fenway. Ortiz's heroics prompted Fox TV announcer Tim McCarver to gush shortly afterwards, saying, "He didn't do it again, did he? Yes he did." The late inning heroics of Ortiz also gave the Red Sox fans a chance to create their own chant, "Who's your Papi?" (Ortiz being known affectionately as "Big Papi"), in rebuttal to the "Who's your daddy?" chant used by Yankees fans in reference to a quote by Pedro Martínez.

Game 5 of the National League Championship Series began at 8:54 pm EST on the same night and was intended to be the second part of FOX's two-game telecast. However, that game proceeded quickly and, despite starting 3 hours and 43 minutes after ALCS Game 5, ended only 24 minutes after the final pitch of this game.

This victory by the Red Sox forced a Game 6. Before this, the 1998 Atlanta Braves and 1999 New York Mets were the only baseball teams ever to be down 0–3 in a seven-game series and force a Game 6, but neither of those teams won that game.

Game 6 was held on Tuesday, October 19 at Yankee Stadium. The starting pitchers were Curt Schilling of the Red Sox and Jon Lieber of the Yankees. Schilling pitched with a torn tendon sheath in his right ankle, which was sutured in place in an unprecedented procedure by Red Sox team doctors. The teams played the first few innings scoreless as cold, windy conditions, combined with a light drizzle, kept many hard hit balls in the field of play. Lieber, who had been brilliant in Game 2, was the first of the starters to falter, to the surprise of many given Lieber's Game 2 outing and Schilling's injured state. Lieber surrendered a two-out single to Jason Varitek, driving in Kevin Millar. Then Orlando Cabrera singled to left field and Mark Bellhorn, who had struggled the entire series, drove a line drive into the left field stands. The ball struck a fan in the chest and dropped back onto the field, after which left field umpireJim Joyce signaled the ball to be still in play, prompting Boston manager Terry Francona to run onto the field and argue the ruling. The officiating crew huddled and ultimately overruled the call. Bellhorn had a three-run home run and the Red Sox had a 4–0 lead. Schilling, still injured from the ALDS and Game 1, pitched seven strong innings, allowing only one run on a Bernie Williams home run. To help stabilize the tendon in his ankle, Red Sox doctors had placed three sutures connecting the skin with ligament and deep connective tissue next to the bone, effectively creating a wall of tissue to keep the peroneal tendon from disrupting Schilling's pitching mechanics. Schilling was only forced to field his position once, and visibly limped to first base to field the toss from Millar. Nonetheless, the Yankees did not bunt for the duration of Schilling's outing, something Joe Torre later explained as not playing out of the normal character of his team. By the end of his performance, Schilling's white sock was partially soaked in blood, and he stated later that he was completely exhausted.

Bronson Arroyo took the mound for Boston in the eighth and, with one out, allowed a Miguel Cairo double. Derek Jeter singled him in to close the gap to 4–2, leading up to the series' most controversial play. Alex Rodriguez grounded a ball to Arroyo, who picked up the ball and ran to the baseline to tag Rodriguez out, but Rodriguez slapped Arroyo's arm, knocking the ball loose. While the ball rolled down the baseline, Rodríguez went to second and Jeter scored. After another long conversation among the umpires, Rodríguez was called out for interference and Jeter was ordered back to first, thus wiping out the score. The Red Sox got out of the inning without further damage. The call further incensed the Yankee fans, already irate over the home run call in the fourth. As Torre and Rodríguez continued to frenetically argue with the umpires, many fans began to throw balls and other debris onto the field. Boston manager Terry Francona pulled his players from the field to protect them. After a delay, order was restored, and Arroyo got out of the inning unscathed. In the top of the ninth, after a leadoff single, the Yankees attempted to turn a double play. However, in a very close play, Orlando Cabrera was called safe at first base. This was the third time in the game that the frustrated New York fan base had a close call go against their team, and they vocalized their displeasure with the umpiring crew. It is unclear if threats were made, however as the Yankees made a pitching change to insert Tanyon Sturtze into the game, crew chief Joe West conversed with both New York City mayor Michael Bloomberg and various NYPD officials. Shortly after this, Sturtze was told to stop his warmup, and NYPD officers began streaming out of the dugouts, and took the field in full riot gear. The police remained on the field, near the first and third base walls, for the remainder of the top of the ninth. The presence of riot police on the field for a half-inning was unprecedented in American professional sports and reflected the chaotic environment of the evening. When the game resumed, Sturtze did get out of the inning, stranding Cabrera. The police vacated the field during the break between innings. Red Sox closer Keith Foulke came in for the bottom of the ninth and allowed Matsui and Sierra to walk, bringing Tony Clark to the plate as the potential pennant-winning run, but Clark struck out swinging on a full count to end the game.

The Red Sox, the 26th team in Major League Baseball playoff history to face a 3–0 series deficit, became the first to force a Game Seven.

After the game, Schilling proudly wore his shirt with the Red Sox's motto, "Why Not Us?" in the locker room and during the press conferences.[27]

For inspiration for their ALCS comeback, the Red Sox gathered in Yankee Stadium's visitors' clubhouse prior to Game 7 to watch Miracle, the movie chronicling the 1980 U.S. men's gold-medal hockey team. The Yankees meanwhile, had Bucky Dent, hero of the Yankees' one-game playoff against Boston in 1978, throw out the ceremonial first pitch.

Game 7 began at 8:30 in the evening on Wednesday, October 20, 2004 at Yankee Stadium. The starting pitchers were Derek Lowe for the Red Sox and Kevin Brown for the Yankees. Johnny Damon led off the game with a single to left and a stolen base, but was thrown out at home trying to score on a Manny Ramirez base hit. The very next pitch, however, was lined into the right-field bleachers by David Ortiz to give Boston a 2–0 advantage. In the second inning, the Sox loaded the bases against Brown, causing Yankees manager Joe Torre to remove him and put in Javier Vázquez to face Johnny Damon. Damon hammered Vázquez' first pitch into the right-field seats for a grand slam to make the score 6-0 Boston. The Red Sox found attrition for their blowout loss at home in Game 3 by crushing the Yankees in similar fashion in the Bronx to put the series away. Damon, who also added an upper deck two-run blast in the fourth, had three hits in the game, despite having only three hits previously in the series. Boston also enjoyed a solid performance from their starting pitcher, Derek Lowe, who allowed only one run and one hit in six innings of work. Lowe, who had significant bullpen experience for the Red Sox, was never even intended to be a starter in the postseason. He pitched game seven on just two days of rest.

Pedro Martínez relieved Lowe in the seventh inning, receiving loud chants of "Who's Your Daddy?," which intensified as he gave up a sequence of hits, allowing two runs on hits by his old foes Matsui, Posada and Williams. He eventually raised the velocity of his fastball to the mid-90s and shut down the rally after a questionable managerial decision by Joe Torre. Torre decided to pinch hit for Clark with the injured John Olerud, who had not played since Game 3, instead of Rubén Sierra. Olerud would end up striking out to end the threat and Martínez was off the hook. Mike Timlin would relieve him in the eighth, pitching an inning and two thirds scoreless. Alan Embree finished the game for Boston. At 12:01 am, on October 21, Rubén Sierra hit a groundball to second baseman Pokey Reese, who threw to first baseman Doug Mientkiewicz to finish the unprecedented comeback. The Red Sox won 10–3 and became the third team in sports history and the first since the 1975 NHL's New York Islanders to win a seven-game series after losing the first three games. David Ortiz was named the series MVP.

The Red Sox became the first Major League team to win eight straight postseason games in the same postseason (four straight in the ALCS and four consecutive games in the World Series). The Oakland Athletics had won ten straight postseason games but they were spread out over two postseasons (the 1989 ALCS and World Series, and the 1990 ALCS). The New York Yankees won eleven straight games also over two consecutive postseasons (the 1998 ALCS and World Series through the 1999 ALDS and into the 1999 ALCS). The 2005 Chicago White Sox repeated this feat, as did the 2014 Kansas City Royals.

The Red Sox became the third team in sports history to lose the first three games of a best-of-seven series and win the last four, joining the 1942 Toronto Maple Leafs and 1975 New York Islanders of the NHL. Boston's NHL franchise, the Bruins, would find themselves on the wrong side of the feat in 2010, losing to the Philadelphia Flyers in the Eastern Conference semifinals.

Game 3 was the longest nine-inning postseason game in history, a 4 hour and 20 minute contest.[25]

In Game 3 Yankee left fielder Hideki Matsui had five hits and five RBIs, tying an American League Championship Series record.

^ abThe rescheduling plan was originally for Game 5, had Game 4 not been delayed one day by rain.

^ abRyan, Bob (October 12, 2004). "Fox's Sunday Lineup a Bonanza for Boston". Boston Globe. p. F2. The Sox-Yankees Game 5 originally was set for a 4:30 pm first pitch. Concerns over where to send the Boston market if the football game ran long had to be a consideration in flopping the ALCS and NLCS starting times.